If you’re unaware, there are two ways in which you can sell a product on Amazon:

You can either choose to operate as a third-party seller — listing, marketing, and pricing merchandise yourself.

Or you can sell as a vendor directly to Amazon-employed buyers for resale.

There are pros and cons to both approaches, but it comes down to how much control and effort you’re wanting to put into the process. Features exist on both ends to help you in connecting with customers either way.

One way, in particular, involves using coupons. Amazon first-party vendors have always had the ability to offer coupons to customers. This capability was just made available to sellers over the last few years. It allows you to create digital coupons for use when promoting products to customers.

If it’s something you’ve yet to take advantage of, you’re potentially missing out on ample opportunities to drive sales and increase revenue. Before hitting the ground running, however, let’s take time to explore how and why your small business should be using Vendor Powered Coupons as part of your Amazon selling strategy.

What Are Vendor Powered Coupons?

Amazon coupons, commonly referred to as Vendor Powered Coupons (VPC), are a promotional tool. They allow vendors and sellers to increase exposure across potential audiences by offering the following around a product or group of products:

Percentage off

Dollars off

Buy one get one deals

Free shipping for a limited time

Social media-based promo codes

VPCs can be found in four locations: product listings, search results, coupon pages featuring daily deals, and in advertising (broad options). Usability tends to be greater for vendors vs. sellers seeing as products submitted for a coupon through Vendor Central show up more frequently for customers above the fold. This leaves seller coupons more likely to get buried.

Advantages to Using VPCs

More often than not, customers come across coupons when visiting a specific product detail page. As a result, VPCs can increase conversion rates.

Generally speaking, if you’re running coupons for bestselling items, you shouldn’t expect to see much in terms of new reach. This is especially true since you can’t hide coupons to be made visible to first-time customers only. Everyone will end up seeing whatever promotion you’re offering, which means you’ll likely end up discounting purchases that would’ve already occurred anyway.

With this being said, an advantage of VPCs is their ability to increase sales velocity around products with low conversions. The more sales you can drive around struggling listings, the better they’ll perform over time based on Amazon’s algorithm.

Additionally, VPCs are beneficial for your offsite marketing efforts. When a coupon promotion is submitted, the provided Coupon Landing Page (CLP) is easy to link to via email newsletters and corresponding social media campaigns. A potential customer will only need to click the link in order for the coupon to be automatically clipped and applied to their account.

After your VPCs are up and running, you’ll be able to track a handful of metrics, like redemption rate. This is a ratio based on the number of times a coupon is redeemed in comparison to the number of times it is clipped. While these metrics can provide valuable insight into product listings, keep in mind that there are frequent glitches limiting your access to available data.

How to Use Amazon Coupons

There are two kinds of coupons that can be created on Amazon: vendor coupons and seller coupons.

How to Create Seller Coupons

To create seller coupons, first sign into your Seller Central account. Navigate to the Advertising tab and select Coupons. If this is your first time doing so, choose the Create your first coupon option.

Narrow in on the products you’re interested in creating discounts for by entering the SKU or Amazon Standard Identification Number (ASIN). You’ll be able to associate up to 50 products with one coupon.

Ad Budget

Once you choose which direction to go with your coupon offering, select a value for your discount as either money or a percentage off. Set a corresponding budget that will help dictate when the coupon becomes deactivated.

Keep in mind that the coupon referral fee for each use is $0.60. This means that if you’re selling a product for $45 with a coupon offering of $10 off, you’ll actually be taking $10.60 off that selling price.

Run Time

Enter a title, along with start and end dates for your coupon. Coupons can be circulated for up to three months. It’s a good idea to experiment with different offerings and update featured products so you can get a feel for what connects most with your audience base.

Audience Targeting

You can choose to target based on customer group segments, such as All Customers, Amazon Family, Prime, and/or Student profiles. Additionally, you can target people based on products they may have purchased or viewed in the past — your own products or those that are complementary or similar. For example, if you want to re-engage with customers that have purchased your products before or those of your competitors, you can do so using specific ASINs.

This can be a great retargeting strategy when conducting a product launch or encouraging return purchases of tried and true favorites. Amplifying attention around products with ample positive Amazon reviews also helps from a social proof standpoint. It can also be a jumping point for customers to explore additional products.

If you don’t choose a target audience, your promotion will be shown to all searchers.

Once your coupon is submitted, it’ll take 48 hours to become active. During this time — while it’s under review — you’ll be able to make edits as needed. When it does go live, you’ll only be able to extend run time and/or increase budget.

How to Create Vendor Coupons

The coupon creation process for vendors starts in the Vendor Central account. Select Merchandising and navigate to Coupons.

After clicking the Create new coupon link, download the form provided and fill out with all relevant information. Upload the coupon template and sign the agreement. Amazon will then review your submission before pushing live on the previously selected start date.

Final Thoughts: Can You Use Coupons on Amazon? Absolutely.

There’s more to selling on Amazon than simply posting a listing and hoping for the best. If you want to be seen and — more importantly — purchased from, you need to take a strategic approach.

From customer reviews to Amazon Storefronts, coupons to sponsored ads, there are a number of moving parts at your disposal for amplifying your Amazon presence. Just as you would your website or brick and mortar store, you want to put your best foot forward. You want to showcase not just your products, but your brand, and connect customers to the real benefits behind whatever it is you’re selling.

If you’re eager to explore questions a bit deeper than "can you use coupons on Amazon?", there’s no better time than the present to do so. Contact the Amplio Digital team and let’s discuss how we can work together to further amplify your revenue!

Kevin is the VP of Growth & Strategy for Amplio Digital and has been with the company since 2014. Kevin drives growth for Amplio and Amazon strategy for its clients. His team manages over $250MM in annual GMV on Amazon for brand manufacturers across North America and EMEA.